FX168 News Agency (Asia-Pacific) reported on Wednesday (March 26) that the well-known crypto Exchange Crypto.com's platform token Cronos (CRO) surged over 20% after a cooperation agreement was reached with TMTG Group, owned by former President Trump, to launch a USA-first crypto ETF this year. However, the Exchange has been accused of "insider manipulation" by reissuing 70 billion tokens that were previously burned in 2021, severely violating the Community's wishes and undermining the principles of decentralization and transparency in the cryptocurrency space.
(Source: CoinMarketCap)
On-chain investigator ZachXBT accused Crypto.com of reissuing CRO tokens in a post, stating: "CRO tokens are no different from a scam, with the number of reissued tokens accounting for 70% of the total supply, which is contrary to the Community's expectations."
He added: "Your (Crypto.com) team just reissued 70 billion CRO tokens a week ago. These CRO were permanently destroyed in 2021 (accounting for 70% of the total supply), which goes against the Community's wishes, as you control the majority of the supply."
(Source: Twitter)
It was previously reported that Trump's TMTG media group has signed a non-binding agreement with Crypto.com to launch a USA cryptocurrency Exchange-traded Fund (ETF) through Crypto.com's broker, Foris Capital US.
ZachXBT added, "I am not sure why Trump's TMTG group would choose to cooperate with your Exchange rather than with Exchanges like Coinbase, Kraken, Gemini, etc."
CoinTelegraph explained that a sudden increase in the circulating supply of tokens could dilute the value of existing tokens, leading to a decrease in price due to supply and demand mechanisms.
In response, Crypto.com CEO Kris Marszalek stated that this move is necessary to support investment growth in the new political environment in the USA. He pointed out, "Cronos and Crypto.com have been operating separately for years, and the initial token burn in the first quarter of 2021 was a defensive measure. At that time, it made sense. Now we have strong support from the new government, the cryptocurrency war is over, and active investment is needed to win."
"This is what the Community wants; it's like we should be considering dollars but are considering cents instead," he added.
Critics also worry that the voting process allowing the reissuance of Bonds may be manipulated.
The crypto circle revealed earlier in March that GitHub users claimed that the validators of the Exchange control up to 70% of the voting rights on the blockchain, giving them the capacity to overturn Community votes.
According to sources from Unchained, Crypto.com reportedly controls 70%-80% of the total voting rights, essentially eliminating the need for any governance votes.
Amid the ongoing controversy surrounding the reissuance of 70 billion CRO tokens, Marszalek highlighted the company's financial and regulatory stability during the interview.
Crypto.com initially disclosed the destruction of 70 billion CRO tokens in a now-deleted blog post from February 2021, calling it "the largest token burn in history," with the goal of achieving "full network decentralization" upon the launch of the CRO mainnet.
The blog post states: "According to our belief, as the CRO chain mainnet is about to go live, we will fully decentralize the chain network."
